$1.6m boost for Wellington start-up
Wellington-based kids' social networking start-up MiniMonos has taken on a high-profile European investor in a [Euro]1 million (NZ$1.6m) capital-raising round.
The eco-themed site, which lets members create monkey avatars and explore a virtual island where they can meet and chat with other players, expects to hit the one million member milestone next month.
MiniMonos chief executive Melissa Clark-Reynolds said the former chief executive of British record company EMI, Elio Leoni- Sceti, now owned 10 per cent of the company after taking part in the funding round.
Leoni-Sceti had also invested in Zynga - the company behind the popular Facebook game Farmville - and British social gaming company We R Interactive.
"It's huge for us. Over the next couple of years we want to grow the company even faster and eventually we will be looking for alliances [with telco and entertainment companies] and an exit. He's got the ability to bring those skills."
A Swiss ethical investment fund called Go-Beyond also contributed to the funding round, which brings the total invested in the company since it launched three years ago to between $3.5 million and $4m. Other shareholders include Wellington angel investor Phil McCaw and the Government's Seed Co-Investment Fund.
MiniMonos was the first non- European start-up to be selected for the Springboard start-up accelerator programme in Britain, and Clark-Reynolds said the three- month workshop last year - which brought it face to face with business mentors from around the world - had transformed it.
MiniMonos had planned to expand into the United States but soon realised the challenges of that "huge" market.
"We didn't have the resources. Taking on Britain has been fantastic for us. In the last week of November we launched pre-paid gift cards at [British supermarket chain] Sainsbury's and we do TV advertising [there].
"Britain is a homogenous market and it's smaller but there's still 70 million people there."
Ninety per cent of the company's revenue - from the close to 3 per cent of users who buy premium subscriptions and in-world virtual items - now comes from Britain, with the remaining 10 per cent coming from the US and Canada. Member numbers have reached about 840,000. More than half are in Britain, where it plans to raise more capital this year.
Clark-Reynolds has previously been critical of selling merchandise tied to kids' social networks, but said it was now realised there was an opportunity to sell "ethical toys" and print products such as books and trading cards, and was in talks to license the MiniMonos brand.
"Fair-trade, sustainable, cradle- to-cradle products have an ability to really succeed [in Britain]."
MiniMonos plans to make a push into Australia later this year. About 20,000 of its members are in New Zealand but the poorer broadband quality meant MiniMonos had not yet promoted the site here, Clark-Reynolds said.
She encouraged Kiwi start-ups to think beyond the US when looking for investment.
"You can look broader. Europe has been really good for us."
- © Fairfax NZ News
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